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Markets to come under pressure

According to dealers, the stock market are expected to come under pressure ahead of budget with a range-bound phase expected to set in.

india Updated: Feb 17, 2006 20:10 IST

Indian shares are expected to come under pressure next week close to the Union budget on February 28 with a range bound phase expected to set in, dealers said.

Mutual funds and retail investors have preferred not to build up fresh investment positions, they said, with the benchmark Sensex sliding below the historic 10,000 levels.

"The markets are expected to come under pressure next week. From a technical viewpoint, 9980 becomes a crucial level," said Manoj Kakaiya, dealer with ULJK Securities.

"We expect select buying at lower levels but selling pressure is likely to be constant," he said.

The markets have risen 6.1 per cent in the new year on overseas fund flows into Indian stocks worth 1.68 billion dollars in the new year.

Foreign funds invested $10.7 billion in 2005.

According to dealers, domestic funds are believed to have collected over two billion dollars in new subscriptions during the past two months.

"We advise investors to look at pure valuations and returns may be measured from here on, considering that the markets have run up sharply over the past 15 months," said a fund manager with a private-sector mutual fund.

The focus in coming days will shift to news-driven policy announcements in the media and the economic survey.

The Mumbai stock exchange's 30-share benchmark Sensex closed Friday at 9,981.11, down 129.86 points or 1.28 percent from the previous week's close of 10,110.97.

First Published: Feb 17, 2006 18:51 IST